Flourishing Era : The Indian pharmaceutical industry.

The Indian Pharmaceuticals industry plays a prominent role in the global pharmaceuticals industry.

The sector contributed to around 1.32% of the Gross Value Added (at 2011-12 constant prices) of the Indian Economy in 2020-21. The total annual turnover of Pharmaceuticals in the fiscal year 2021-22 was $ 42.34 Bn. Major segments of Indian Pharmaceutical Industry include generic drugs, OTC medicines, bulk drugs, vaccines, contract research & manufacturing, biosimilars and biologics. India is a global leader in the supply of DPT, BCG, and Measles vaccines.

India is one of the biggest suppliers of low-cost vaccines in the world. India accounts for 60 % of global vaccine production, contributing upto 70 % of the WHO demand for Diphtheria, Tetanus and Pertussis (DPT) and Bacillus Calmette–Guérin (BCG) vaccines, and 90% of the WHO demand for the measles vaccine.

The nation is the largest provider of generic medicines globally, occupying a 20% share in global supply by volume, and is the leading vaccine manufacturer globally. India also has the highest number of US-FDA compliant Pharma plants outside of USA and is home to more than 3,000 pharma companies with a strong network of over 10,500 manufacturing facilities as well as a highly skilled resource pool.

There are 500 API manufacturers contributing about 8% in the global API Industry. India is the largest supplier of generic medicines. It manufactures about 60,000 different generic brands across 60 therapeutic categories and accounts for 20% of the global supply of generics. Access to affordable HIV treatment from India is one of the greatest success stories in medicine. Because of the low price and high quality, Indian medicines are preferred worldwide, making it “pharmacy of the world”.

Formulating success: The Indian pharmaceutical industry.

The Indian Pharmaceuticals industry plays a prominent role in the global pharmaceuticals industry.

100% Foreign Direct Investment (FDI) in the pharmaceutical sector is allowed under the automatic route for greenfield pharmaceuticals.

100% FDI in the pharmaceutical sector is allowed in brownfield pharmaceuticals; wherein 74% is allowed under the automatic route and thereafter through the government approval route.

Industry Scenario

The pharmaceutical industry in India is expected to reach $65 Bn by 2024 and to $130 Bn by 2030.

The pharmaceutical industry in India is currently valued at $50 Bn.

India is a major exporter of Pharmaceuticals, with over 200+ countries served by Indian pharma exports. India supplies over 50% of Africa’s requirement for generics, ~40% of generic demand in the US and ~25% of all medicine in the UK.

India also accounts for ~60% of global vaccine demand, and is a leading supplier of DPT, BCG and Measles vaccines. 70% of WHO’s vaccines (as per the essential Immunization schedule) are sourced from India.

The Average Index of Industrial Production of Manufacturing of pharmaceuticals, medicinal chemicals and botanical products in the FY 2021-22 is 221.6 and has grown by 1.3%

For the period 2021-22, export of drugs and pharma products stood at $24.6 Bn compared to $24.44 Bn as of 2020-21. The Indian pharma industry witnessed exponential growth of 103% during 2014-22 from $11.6 bn to $24.6 Bn.

GROWTH DRIVERS BY GOVERNMENT

Government Support
Government incentives including an outlay of INR 21,940 for PLI 1.0 and PLI 2.0 . Three bulk drug parks, located in Gujarat, Himachal Pradesh, and Andhra Pradesh should provide a consistent supply of bulk drug active components and will ensure India's drug security.
Medical tourism
Quality services at marginal costs compared to US, Europe, and South Asia
Infrastructure development
India has the highest number of US-FDA compliant plants outside the US
Strong drug manufacturing
Expertise in low cost generic patented drugs as well as end-to-end manufacturing
Strong domestic demand
Launch of the largest National Health Protection Scheme globally
Production Linked Incentive (PLI) Scheme
The Indian pharmaceuticals market is supported by the following Production Linked Incentive Schemes to boost domestic manufacturing capacity, including high-value products across the global supply chain.
1. PLI Scheme for Key Starting Materials (KSMs)/Drug Intermediates (DIs) and Active Pharmaceutical Ingredients (APIs) (PLI 1.0) 2. Production-Linked Incentive (PLI) Scheme for Pharmaceuticals d (PLI 2.0) Under the PLI scheme for Pharmaceuticals, 55 applicants have been selected, including 20 Micro, Small & Medium Enterprises (MSMEs). As of 31st January 2023, sales of about INR 36,000 cr have been reported by the select applicants. The scheme has garnered an investment of INR 16,199 crores by these applicants in the first year of implementation while employing 23,000 persons in the same period. Under the PLI scheme for Bulk Drugs, the objective is to boost domestic production of 41 select critical bulk drugs in the country. 51 projects have been selected for the 34 notified bulk drugs. Out of this, 22 projects have been commissioned till 31st January 2023. An investment of INR 2019 crores have been reported while employing 1900 persons in the same period.

Flourishing Era : The Indian pharmaceutical industry.